NEW YORK -LRB- CNN -RRB- -- More than two years after her death , Carol Anne Gotbaum 's children are expected to receive a $ 250,000 settlement from an insurance company on behalf of the city of Phoenix , Arizona , and its police department .

Carol Gotbaum , shown in an undated family photo , died accidentally , a medical examiner said .

The 45-year-old Gotbaum accidentally strangled herself while in police custody after behaving erratically in a terminal at Phoenix 's Sky Harbor airport when she missed her connecting flight , according to both family and police accounts .

Gotbaum , the stepdaughter-in-law of New York City Public Advocate Betsy Gotbaum , was traveling alone and unescorted on her way to an alcohol rehabilitation center in Tucson , Arizona .

Gotbaum 's family had originally sought $ 8 million but subsequently reduced that to $ 5.5 million . They accused the city and its police department of negligence in leaving Gotbaum chained and unattended in an airport police cell .

Her three children , all still under age 10 , will be the beneficiaries of the settlement once it is approved by a New York surrogate court , whose duties are to deal with issues concerning the deceased .

According to the Phoenix Police Department , its insurance carrier had spent $ 500,000 so far on the case and anticipated spending another $ 750,000 in litigation . It was a financial decision by the insurance carrier to settle in order to minimize further costs , the department said .

Witnesses reported that Gotbaum may have been drinking on her flight and had been drinking heavily in an airport bar just before the altercation with police . She had missed her connection and was bumped from another one after airline personnel would not allow her to use a boarding pass given to her by another passenger . She grew incensed , threw her phone and started running down the concourse yelling , `` I am not a terrorist , '' according to witness accounts .

Police said they had no information regarding her physical or psychological state when they responded to a call from gate agents . In a security video she is seen struggling with officers as they drag her down a concourse .

An internal police investigation and one by the city found that the police did not violate any laws . But Gotbaum 's husband , Noah , filed suit claiming the officers were negligent in leaving her unattended in a disoriented state .

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Carol Anne Gotbaum 's children are expected to receive a $ 250,000 settlement

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Money comes from insurance company on behalf of police and city of Phoenix

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Gotbaum accidentally strangled herself while in police custody

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Woman was taken into custody after acting erratically at airport